China Sets the Gold and Silver Price

Housekeeping: Good Morning. “The reset is a process, not an event.”Today* Topic : Shanghai Wins AgainMarket Analysis: Comex CapitulationAfter dipping to just above $3,100 late last week, gold has mounted a sharp rebound. As of Tuesday evening, it was trading back at $3,300—reclaiming the same level where it ended April. There’s a reason for the recovery as cataloged here days prior.In a note to Founders Monday morning we stated the following: Three important things stand out in our reading of this analysis* They point out Comex lack of volumes implying China’s controls global price even more- Comex Deathwatch* China’s ETF buying has been massive, but their pukes/liquidations have been less so cyclically speaking.- Why?* China’s SFE/COMEX premium spread this time has remained sticky despite a historical tendency to disappear post gold allocationsQuote: Unless this changes, the (price) trend will continue (higher)This morning we got confirmation of this analysis from none other than Goldman Sachs.Goldman Makes The Same PointAccording to a Goldman via a ZH premium post, China is back on the bid. Specifically, renewed onshore buying during the Chinese night session in Shanghai had reignited US demand. Open interest has jumped—up 3% for gold and 4% for silver—driven by the SHFE/COMEX spread narrowing towards the Shanghai price. The West Capitulates.Goldman’s trader then points out something even more notable just as we did Monday 7:35 AM: Onshore positioning has held firm at elevated levels, even as gold fell 8% from its highs. That resilience stands out, especially considering the typically momentum-driven nature of the domestic trading crowd. This how you break an exchange franchise’s hold on pricing. by making the market resolve differences at your price. Comex is slowly capitulating and with it US hegemony in Gold pricing. As stated yesterday.. Part of this blame can be laid at the LBMA’s regulatory feet for not protecting western global wealth by zealously guarding its franchise. Gold is money and the west has much less of it nowComing Soon:Data on Deck: * WEDNESDAY, MAY 21 12:15 pm Richmond Fed President Tom Barkin and Fed Governor Michelle Bowman take part in Fed Listens event Related Posts:Summary and Final Market Check… This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit vblgoldfix.substack.com/subscribe